Bloomberg News

Germany Public-Sector Pay Talks Face Mediation as Strikes Loom

March 29, 2012

German Chancellor Angela Merkel’s government may summon mediators to avert fresh strikes in the public sector after pay negotiations for about 2 million workers stalled, the Ver.di labor union said.

Talks between Interior Minister Hans-Peter Friedrich and Ver.di, Germany’s second-largest union, broke up yesterday after the government refused to improve its wage offer of 3.3 percent over two years. Negotiations resumed today in Potsdam near Berlin, where the union is pressing for a boost of 6.5 percent for federal and municipal workers.

“The signs are that Friedrich will call mediation before making a new offer, meaning today’s talks will not lead to an accord,” Jan Jurczyk, a spokesman for Berlin-based Ver.di, said by phone. “We’ve shown we’re ready to strike to defend our pay claim and that’s definitely not in the government’s interest.”

The public-sector pay talks are closely watched by German industry as a guideline for wage accords across the country. Pay arrangements covering about 9.1 million workers are due to expire this year, with negotiations about to start or resume for workers from companies from Deutsche Telekom AG (DTE) to Volkswagen AG (VOW).

Friedrich, who represents the government in the talks, said yesterday that Ver.di’s 6.5 percent claim was “unrealistic.” IG Metall, which with 2.24 million members is the biggest union in Europe as well as in Germany, has meanwhile also tabled a demand for 6.5 percent more pay.

Consumption Boost

Ver.di Chairman Frank Bsirske has said his union’s demand is fair after a moderate pay increase two years ago helped speed Germany out of a recession. The claim is further justified as a means to bolster private consumption that the government estimates will grow just 1.5 percent this year, Bsirske says.

Wage moderation in both the private and public sector is cited by the government for having helped Germany roll back unemployment even as the tally of those without work in other euro-area states soared. German unemployment fell more than forecast in March, with the rate dropping to a fresh two-decade low of 6.7 percent, the Federal Labor Agency said today.

During wage mediation, strikes are outlawed under German tariff rules. Such a move would prevent the union from widening its so-called warning strikes that brought 250,000 of its members onto the streets, closed kindergartens and on March 27 forced the cancellation of a third of Frankfurt airport flights.

Ver.di negotiates with Germany’s 16 states separately. A pay accord for 500,000 state workers will expire at the end of this year.

To contact the reporter on this story: Brian Parkin in Berlin at

To contact the editor responsible for this story: James Hertling at

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